Annual report pursuant to Section 13 and 15(d)

Business Segment Reporting

v3.22.0.1
Business Segment Reporting
 12 Months Ended
Dec. 31, 2021
Segment Reporting [Abstract]  
Business Segment Reporting
33. Business Segment Reporting
The following tables are a presentation of financial information by segment for the periods indicated (in thousands):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
April 1, 2021 to December 31, 2021
  
   
Successor
  
   
Mortgage
Originations
    
Reverse
Originations
    
Commercial
Originations
    
Lender
Services
    
Portfolio
Management
    
Total
Operating
Segments
    
Corporate
and Other
    
Elim
    
Total
  
REVENUES
                                                                        
Gain on sale and other income from loans held for sale, net
   $ 542,951     $ —       $ —       $ —       $ 39,950     $ 582,901     $ —       $ (18,376 )    $ 564,525  
Net fair value gains on loans and related obligations
     —         317,138       37,720       —         (30,738 )      324,120       —         17,630       341,750  
Fee income
     88,399       3,274       43,015       252,268       30,455       417,411       —         (31,346 )      386,065  
Net interest income (expense)
                                                                        
Interest income
     42,555       —         —         68       1,027       43,650       275       —         43,925  
Interest expense
     (34,569 )      —         —         (260 )      (52,625 )      (87,454 )      (20,240 )      —         (107,694 ) 
Net interest income (expense)
     7,986       —         —         (192 )      (51,598 )      (43,804 )      (19,965 )      —         (63,769 ) 
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Total revenues
     639,336       320,412       80,735       252,076       (11,931 )      1,280,628       (19,965 )      (32,092 )      1,228,571  
Total expenses
     639,196       122,389       64,026       229,227       92,197       1,147,035       74,535       (37,814 )      1,183,756  
Goodwill and intangible asset impairment expense
     (774,524 )      (408,241 )      (75,768 )      (110,188 )      (11,909 )      (1,380,630 )      —         —         (1,380,630 ) 
Other, net
     —         248       423       3,040       1,170       4,881       15,193       (5,932 )      14,142  
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Net
(loss) 
income before taxes
   $ (774,384 )    $ (209,970 )    $ (58,636 )    $ (84,299 )    $ (114,867 )    $ (1,242,156 )    $ (79,307 )    $ (210 )    $ (1,321,673 ) 
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Depreciation and amortization
   $ 9,147     $ 29,006     $ 1,909     $ 8,681     $ 132     $ 48,875     $ 1,130     $ —       $ 50,005  
Total assets
     2,148,504       359,896       41,470       227,966       18,974,389       21,752,225       994,074       (957,353 )      21,788,946  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
January 1, 2021 to March 31, 2021
  
   
Predecessor
  
   
Mortgage
Originations
    
Reverse
Originations
    
Commercial
Originations
    
Lender
Services
    
Portfolio
Management
    
Total
Operating
Segments
    
Corporate
and Other
    
Elim
    
Total
  
REVENUES
                                                                        
Gain on sale and other income from loans held for sale, net
   $ 286,481     $ —       $ —       $ —       $ 5,065     $ 291,546     $ —       $ (212 )    $ 291,334  
Net fair value gains on loans and related obligations
     —         68,449       5,431       —         2,750       76,630       —         33       76,663  
Fee income
     32,731       524       8,930       76,383       36,191       154,759       —         6,612       161,371  
Net interest income (expense)
                                                                        
Interest income
     12,483       —         —         28       138       12,649      
12

       —         12,661  
Interest expense
     (11,592 )      —         —         (64 )      (14,954 )      (26,610 )      (7,756 )      —         (34,366 ) 
Net interest income (expense)
     891       —         —         (36 )      (14,816 )      (13,961 )      (7,744 )      —         (21,705 ) 
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Total revenues
     320,103       68,973       14,361       76,347       29,190       508,974       (7,744 )      6,433       507,663  
Total expenses
     224,246       23,693       13,391       62,970       24,406       348,706       18,683       5,925       373,314  
Other, net
     —         34       149       2       895       1,080       (9,464 )      (508 )      (8,892 ) 
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Net income (loss) before taxes
   $ 95,857     $ 45,314     $ 1,119     $ 13,379     $ 5,679     $ 161,348     $ (35,891 )    $ —       $ 125,457  
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Depreciation and amortization
   $ 1,423     $ 151     $ 125     $ 1,268     $ 146     $ 3,113     $ 371     $ —       $ 3,484  
Total assets
     2,425,529       35,861       82,375       125,317       17,378,088       20,047,170       379,562       (326,313 )      20,100,419  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
For the year ended December 31, 2020
  
   
Predecessor
  
   
Mortgage
Originations
    
Reverse
Originations
    
Commercial
Originations
    
Lender
Services
    
Portfolio
Management
    
Total
Operating
Segments
    
Corporate
and Other
    
Elim
    
Total
  
REVENUES
                                                                        
Gain on sale and other income from loans held for sale, net
   $ 1,171,368     $ —       $ —       $ —       $ 10,192       1,181,560     $ —       $ (2,565 )    $ 1,178,995  
Net fair value gains on loans and related obligations
     —         192,257       13,350       —         103,872       309,479       —         2,219       311,698  
Fee income
     118,237       1,837       23,862       205,197       28,002       377,135       3,117       9,617       389,869  
Net interest income (expense)
                                                                        
Interest income
     41,688       —         —         174       714       42,576       8       —         42,584  
Interest expense
     (39,792 )      —         —         (255 )      (73,877 )      (113,924 )      (8,945 )      (132 )      (123,001 ) 
Net interest income (expense)
     1,896       —         —         (81 )      (73,163 )      (71,348 )      (8,937 )      (132 )      (80,417 ) 
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Total revenues
     1,291,501       194,094       37,212       205,116       68,903       1,796,826       (5,820 )      9,139       1,800,145  
Total expenses
     831,563       87,219       41,341       185,361       90,854       1,236,338       48,280       9,139       1,293,757  
Other, net
     —         —         —         —         —         —         (6,131 )      —         (6,131 ) 
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Net income (loss) before taxes
   $ 459,938     $ 106,875     $ (4,129 )    $ 19,755     $ (21,951 )    $ 560,488     $ (60,231 )    $ —       $ 500,257  
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Depreciation and amortization
   $ 5,951     $ 897     $ 568     $ 4,810     $ 130       12,356     $ 1,515     $ —       $ 13,871  
Total assets
     2,362,159       25,841       82,436       117,254       16,895,820       19,483,510       81,645       —       $ 19,565,155  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   
For the year ended December 31, 2019
  
   
Predecessor
  
   
Mortgage
Originations
    
Reverse
Originations
    
Commercial
Originations
    
Lender
Services
    
Portfolio
Management
    
Total
Operating
Segments
    
Corporate
and Other
    
Elim
    
Total
  
REVENUES
                                                                        
Gain on sale and other income from loans held for sale, net
   $ 462,700     $ —       $ —       $ —       $ 9,303       472,003     $ —       $ (7,695 )    $ 464,308  
Net fair value gains on loans and related obligations
     —         141,022       30,512       —         151,679       323,213       —         6,313       329,526  
Fee income
     64,372       3,478       36,094       110,046       7,923       221,913       (2,529 )      (20,285 )      199,099  
Net interest income (expense)
                                                                        
Interest income
     36,673       —         —         213       414       37,300       23       —         37,323  
Interest expense
     (37,076 )      —         —         (183 )      (96,108 )      (133,367 )      (5,167 )      (197 )      (138,731 ) 
Net interest income (expense)
     (403 )      —         —         30       (95,694 )      (96,067 )      (5,144 )      (197 )      (101,408 ) 
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Total revenues
     526,669       144,500       66,606       110,076       73,211       921,062       (7,673 )      (21,864 )      891,525  
Total expenses
     506,894       79,522       51,882       105,203       63,907       807,408       35,137       (24,267 )      818,278  
Other, net
     —         —         —         —         —         —         4,332       —         4,332  
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Net income (loss) before taxes
   $ 19,775     $ 64,978     $ 14,724     $ 4,873     $ 9,304     $ 113,654     $ (38,478 )    $ 2,403     $ 77,579  
   
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Depreciation and amortization
   $ 5,954     $ 481     $ 616     $ 4,169     $ 170       11,390     $ 1,718     $ —       $ 13,108  
Total assets
     1,321,342       91,892       114,943       86,070       15,102,567       16,716,814       504,882       (637,595 )    $ 16,584,101  
The Company has identified six reportable segments: Mortgage Originations, Reverse Originations, Commercial Originations, Lender Services, Portfolio Management and Corporate/Other.
Mortgage Originations
The Mortgage Originations segment originates mortgage loans through FAM. This segment generates revenue through
fee-based
mortgage loan origination services and the origination and sale of mortgage loans into the secondary market. The Mortgage Originations segment includes four channels: distributed retail lending,
direct-to-consumer
lending, third-party-originator lending and home improvement.
Reverse Originations
The Reverse Originations segment originates or acquires reverse mortgage loans through FAR. This segment originates HECMs which are insured by the FHA, and proprietary jumbo reverse mortgages. The segment originates reverse mortgage loans through the following channels: retail and third-party-originator. Reverse mortgage lending activities primarily consist of the origination and securitization of mortgage loans to GNMA and other private investors.
 
Commercial Originations
The Commercial Originations segment originates or acquires commercial mortgage loans through FACo. The segment provides business purpose lending solutions for residential real estate investors in two principal ways: short-term loans to provide rehab and construction of investment properties meant to be sold upon completion, and investor rental loans collateralized by either a single asset or portfolio of properties. The segment also provides government-insured agricultural lending solutions to farmers to fund their inputs and operating expenses for the upcoming growing season.The segment originates commercial mortgage loans through the following channels: retail and third-party-originator. Commercial mortgage lending activities primarily consist of the origination and securitization of commercial mortgages to private investors.
Portfolio Management
The Portfolio Management segment provides product development, loan securitization, loan sales, risk management, asset management and servicing oversight services to the enterprise and third-party funds.
Lender Services
The Lender Services segment provides ancillary business services, title agency and title insurance services, MSR valuation and trade brokerage, and appraisal management services to customers in the residential mortgage, student lending, and commercial lending industries. The segment also operates a foreign branch in the Philippines for fulfillment transactional and administrative support.
Corporate and Other
Corporate and other consists of the Business Excellence Office (“BXO”) and other corporate services groups.
The Company’s segments are based upon the Company’s organizational structure which focuses primarily on the services offered. Corporate functional expenses are allocated to individual segments based on actual cost of services performed based on a direct resource utilization, estimate of percentage use for shared services or headcount percentage for certain functions.
Non-allocated
corporate expenses include administrative costs of executive management and other corporate functions that are not directly attributable to the Company’s operating segments. Revenues generated on inter-segment services performed are valued based on similar services provided to external parties. To reconcile the Company’s consolidated results, certain inter-segment revenues and expenses are eliminated in the “Eliminations” column in the following tables.